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Endogenous Censoring in the Mixed Proportional Hazard Model with an Application to Optimal Unemployment Insurance

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journal contribution
posted on 29.05.2019, 15:07 by Arkadiusz Szydlowski
We examine the sensitivity of estimates of the MPH model with respect to assumptions on the censoring mechanism in the context of an economic model of optimal unemployment insurance. We assume a parametric model for the duration of interest and leave the distribution of censoring unrestricted, allowing it to be correlated with observed and unobserved characteristics. We provide a practical characterization of the identified set with moment inequalities and suggest methods for estimating this set. We apply this approach to estimate the elasticity of unemployment exit rate with respect to unemployment benefit. Finally, we investigate welfare consequences of our estimates.

Funding

I would like to thank Raj Chetty for sharing his dataset and codes. This research used the ALICE High Performance Computing Facility at the University of Leicester and the Social Sciences Computing Cluster (SSCC) at Northwestern University.

History

Citation

Journal of Applied Econometrics, 2019

Author affiliation

/Organisation/COLLEGE OF SOCIAL SCIENCES, ARTS AND HUMANITIES/School of Business

Version

AM (Accepted Manuscript)

Published in

Journal of Applied Econometrics

Publisher

Wiley

issn

0883-7252

Acceptance date

23/05/2019

Copyright date

2019

Publisher version

https://onlinelibrary.wiley.com/doi/full/10.1002/jae.2731

Notes

The file associated with this record is under embargo until 24 months after publication, in accordance with the publisher's self-archiving policy. The full text may be available through the publisher links provided above.

Language

en

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